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Equity Disclosures

1Closing Cost Credit: PenFed will pay most closing costs associated with a fixed equity, equity line of credit (ELOC) and 5/5 ELOC loan which includes: credit report, flood certification, settlement/closing, property ownership and encumbrances search, express delivery package, express delivery disbursal, recording, city/county taxes, state taxes, property search and quick close. For New York or Texas properties, borrowers are required to pay title insurance premiums and may use any title company to obtain the closing cost credit. If an appraisal is required, the cost will be paid by the member, who is responsible for the fee whether or not the loan closes. The member is responsible for notary fees. Should this loan be paid off or closed within 24 months (or 36 months for the 5/5 ELOC) from the anniversary date of the loan closing, the member will be obligated to pay PenFed the full amount of the total closing cost for the loan. Other terms and conditions apply; call 1-800-970-7766 for details.

2Interest may be tax deductible, consult a tax advisor for further information regarding the tax deductibility of interest and charges.

Appraisals: An appraisal is required for all applications with a loan to value (LTV) over 80%. For applications with a LTV of 80% or less, PenFed will attempt to establish value via an independent method. If that method is unsuccessful, an appraisal will be required regardless of LTV. An appraisal is required in the following circumstances:

For any loan amount if the loan to value ratio (LTV) is greater than 80%; or

For all fixed term equity loans and equity lines of credit with a loan amount greater than $250,000.

If an appraisal is required it must be ordered by PenFed. You will be contacted for authorization and payment prior to ordering. Appraisal fees average $350 to $525 (some run higher) and approximately 50% of our applications require an appraisal.

Property in First Lien Position: The maximum term for a fixed rate equity loan that reflects PenFed in the first lien position is 60 months. Equity products are not offered on properties that are non-owner occupied with a first lien position.

Property Insurance: Property insurance is required.

PenFed Mortgage Aggregate:If PenFed holds the 1st mortgage plus any equity loans or lines of credit on the same collateral and the new loan exceeds $750,000 maximum combined loan-to-value (CLTV) ratio is 80% CLTV in all states.

PenFed Refinances:

Effective for applications received on or after June 28, 2014- no requirement to take additional funds for refinance.

Multiple Loans: Multiple equity loans and ELOCs are available as long as the member and collateral qualify (except Texas). The total indebtedness cannot exceed $400,000 for all equity and ELOCs combined.

PenFed does not lend on:

Mobile homes

Co-ops or time-shares

Properties that are for sale/rent

Commercial property or property used for commercial purposes, even if a residence is part of the property

Undeveloped property (land only)

Properties with more than 4 units.

Properties that are currently under major construction/renovations. Property must be fully livable, with no safety issues. (examples: no missing rails from stairs/decks, no open walls with wires showing, missing kitchen appliances/counters, missing bath fixtures or unfinished pool)

In Texas, the maximum owner occupied LTV allowed is 80% and non-owner occupied is LTV 75%. Additional restrictions apply in Texas, so please ask a representative for details.

In states other than Texas, the maximum owner occupied LTV is 90% (first lien position is limited to 80% LTV) and non-owner occupied LTV is 80%. No equity product is offered for non-owner occupied in a first lien position.

The maximum LTV for a condominium in all states is 70%.

Rates are higher for non-owner occupied properties. Other terms and conditions may apply. Call 800-970-7766 to talk to a representative for details.

Minimum Loan Amount Requirements in all States:

For a fixed home equity loan and ELOC owner occupied property the minimum loan amount is $10,000 and the maximum amount is $400,000 with an LTV of 85% or less of the fair market value and a maximum of $100,000 with an LTV 85.01 to 90.00%.

For a non-owner occupied fixed home equity loan and ELOC the minimum loan amount is $10,000 and the maximum amount is $400,000 with an LTV up to 80% of the fair market value.

For a 5/5 ELOC owner occupied property the minimum loan amount is $25,000 and the maximum amount is $400,000 with a LTV of 75% or less of the fair market value and non-owner occupied LTV of 70% or less of the fair market value.

Fixed Home Equity Loan Payment Examples: For an owner occupied home of $25,000 at 3.74% APR payable over 5 years: 60 monthly payments of approximately $457.60 each. For an owner occupied home of $25,000 at 4.24% APR payable over 15 years: 180 monthly payments of approximately $187.94 each.

Equity Line of Credit: Rate depends on loan term length, loan to value (LTV), fair market value (FMV) owner occupancy, and use of funds. Typical closing costs range from $250 to $750 depending on the loan amount and county where property resides.

The minimum credit advance that you can receive is $100. (The minimum in Texas is $4,000). PenFed does not allow Automated Clearing House (ACH) advances on Equity Line of Credit accounts. PenFed reserves the right to reject any advance that is converted to an electronic check by the merchant and submitted via ACH.

LTV ratio requirements:

In Texas, the maximum combined loan to value (CLTV) allowed is 80% with an ELOC amount not to exceed 50% of the market value, regardless of equity available. Additional restrictions apply in Texas, so please ask a representative for details.

In states other than Texas, the maximum owner occupied LTV is 90% and non-owner occupied LTV is 80%. No equity product is offered for non-owner occupied in a first lien position.

The maximum LTV for a condominium in all states is 70%.

Rates are higher for non-owner occupied properties. Other terms and conditions may apply. Call 800-970-7766 to talk to a representative for details.

5/5 Equity Line of Credit: Rate depends on loan term length, loan to value (LTV), fair market value (FMV) owner occupancy, and use of funds. Typical closing costs range from $250 to $750 depending on the loan amount and county where property resides.

LTV ratio requirements:

In Texas, the maximum combined loan to value (CLTV) allowed is 75% with an ELOC amount not to exceed 50% of the market value, regardless of equity available. Additional restrictions apply in Texas, so please ask a representative for details.

In states other than Texas, the maximum owner occupied LTV is 75% and non-owner occupied LTV is 70%. No equity product is offered for non-owner occupied in a first lien position.

The maximum LTV for a condominium in all states is 70%.

Rates are higher for non-owner occupied properties. Other terms and conditions may apply. Call 800-970-7766 to talk to a representative for details.

5/5 Equity Line of Credit Rate Adjustments and Terms: The 5/5 ELOC is an adjustable rate loan product with an APR that can be adjusted every five years. The rate is indexed to the United States Treasury Security adjusted to a constant maturity of five years as published in the Wall Street Journal each Tuesday. The 5/5 ELOC has a term of 180 months during which time the member can access the account. Non-owner occupied properties have a term of 144 months. The loan must be paid off at the end of the term. Members with expiring 5/5 ELOCs will be contacted prior to the maturity date with an offer to refinance the credit line if there is a balance. The member must qualify for the new credit line. Other terms and conditions apply; call 1-800-970-7766 for details.

Rates are higher for non-owner occupied properties. Other terms and conditions apply. Call 800-970-7766 to talk to a representative for details.

All rates and offers are as of August 2015 and subject to change without notice. To receive advertised product you must become a member of PenFed by opening a share (savings) account.

We do business in accordance with the Federal Fair Housing Law and the Equal Credit Opportunity Act.

This credit union is federally insured by the National Credit Union Administration. Rates are current as of August 2015 unless otherwise noted and are subject to change. APY = Annual Percentage Yield APR = Annual Percentage Rate

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* In states other than Florida, Michigan, and Texas, the maximum owner occupied CLTV (combined loan to value) for a PenFed Home Equity Loan is 85%, non-owner occupied is 75%. In Florida and Michigan, the maximum owner occupied CLTV is 70%. In Texas, the maximum owner occupied CLTV allowed is 80% and non-owner occupied is CLTV 75%. Additional restrictions apply in Texas, so please ask a representative for details. The maximum CLTV on condominiums in all states is 70%.